College Students and Credit Card DebtDebt has become a real issue in this economy and credit cards play a major role in assisting the problem. Adults are barely responsible enough to budget their expenses and credit card companies are now prying on college students. Just coming out of high school a 17-18 year old does not have the mind capacity to understand finances and the importance of a good credit history. The credit card companies bombard students with enticing offers of credit limits; cash back reward options, and no annual fees. They however, omit the high interest rates and penalties for not paying the balance off in full or for having late payments. The companies also fail to advise individuals of how to use the cards or how easy it is to find yourself in debt with a swipe here and a swipe there of the cards. College students should not be allowed to apply for credit on his or her own. Credit card companies target the college student because they are the ideal consumer. Right out of high school with the false sense of adulthood and responsibility, the companies know that students do not know the adverse effects of using credit irresponsibly. The value of their credit score is not important and the companies target that. The average drop for one late payment of 30 days can be up to 110 points for higher credit scores and 45 points for maxing out the credit limit (Consumer Action). They apply for the cards and are approved and the only numbers they see are the limits they have been approved for. Students are not looking at how hard it will be if they get into debt because of the penalty fees and interest rates that apply to outstanding balances each due date, which are higher for cash advances on the cards. The average late fee penalty is between 25.90 and 28.19 per card (Demos.Org).One should be understanding of have a credit card for emergency purposes while away at school that a responsible parent can monitor the use and the amount of credit he or...

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Destiny Lewis
DRE 097 Section 2:30
Mrs. Malia
October 1, 2014
Credit and debit cards are similar by both being a way to quickly access money, but they differ by the way you are able to access the funds.
Debit cards are linked to your bank account, you can only get out what have earned or put in. Credit cards are like a loan you usually have to pay money back over a period of time. Most debit cards are free of charge and don’t require a monthly fee. Credit cards have the advantage of reward points but an annual fee is required. Credit cards and debit cards both have their advantages. Credit cards build you credit, provide more perks, and excellent security. There are many benefits of having a credit card for use of car loans or home loans. Benefits of having a debit card would be the fact that there are no minimum charges and are accepted almost anywhere
*Debit cards are a safer, faster, and convenient method to access your money.
Debit cards are the easiest way to access funds. Using a debit card the funds come straight out of your bank account, which makes it easier to manage your money. Most people have direct deposit to an account which they can directly access when using a debit card. You don’t have to worry about having to wait on a check to be mailed or deal with the long process of cashing it. The moment the money is put into the account it becomes active for you to have access to.
Credit cards do not require a connection with a savings...

...on an automobile loan is $375. What is Louise’s debt payments-to-income ratio? Is Louise living within her means? (LO 5.3)
Louise’s Gross Income
=
$3,000
Less: Income taxes
=
-700
Less: Social Security Tax
=
-250
Less: IRA contribution
=
-100
Net take-home pay
=
$1,950
Her monthly payments on VISA, MasterCard, and a car loan add up to $500 per month. Louise’s debt payments to income ratio is 500 to 1,950, or 25.6 percent. This ratio exceeds the recommended 20 percent figure. Therefore, Louise is overextended. Her maximum monthly loan and credit card payments should not be over $390.
3. Robert Sampson owns a $175,000 townhouse and still has an unpaid mortgage of $140,000. In addition to his mortgage, he has the following liabilities:
Visa
$705
MasterCard
280
Discover card
505
Education loan
2,000
Personal bank loan
300
Auto loan
5,000
Total
$8,790
Robert’s net worth (not including his home) is about $35,000,. This equity is in mutual funds, an automobile, a coin collection, furniture, and other personal property. What is Robert’s debt-to-equity ratio? Has he reached the upper limit of debt obligations? Explain. (LO 5.3)
Robert’s total debt (not including mortgage) is $8,790. His net worth (not including his home) is $35,000. Therefore, his debt-to-equity ratio is $8,790 divided by $35,000, or 0.25. Since this ratio is less than 1,...

...Nowadays, every business needs finance. But at the same time, bad debt has become a stinging problem for the creditors. Many companies are faced with the high credit risk, so obtaining it can be one of the most difficult parts of running your business.
So what is the solution for this problem? You can see, there are so many types of business finance, including: bank loans, credit cards, leasing, even outsides investors, family and friend loans… But in my opinion, one of the quickest forms of low cost business finance is factoring, where you can get up to 85% of the value of your invoice immediately, and the remainder (minus the factoring company’s fee) after the money is collected. kFactoring is one of the best ways to get quick finance, improving your cashflow and allowing you to make the most of your sales without risking late payment.
What is factoring? You can image that just be simple to sell your invoice to a factoring company. You can get cash quickly, have a chance to access immediate funds, without having to wait for the customer to pay the invoice. You also don’t have to collect the debt. Because you transfer the mission to the factoring company. They get debt and have to collect it. Of course, you lose some of the value of the invoice. And the difference between the price it paid for the invoice and the money from the debtor is the factor’s overall profit. They can provide money either with recourse or without...

...Name(s): Cruz Victor Sandoval III
Date: 11/26/2012
Per: 07
Credit and Debt
Complete each sentence by typing the correct word in the space provided.
credit credit bureau credit rating
collateral finance charges annual percentage rate
Truth in Lending laws
1. If you use your car as _collateral___ (property used to secure a loan), and you do not pay the loan back, the creditor has the right to repossess your car.
2. When a bank extends you _credit___, it allows you to borrow money and pay it back later with interest.
3. The _truth in lending laws___ require lenders to disclose the monthly interest rates and the method they use to calculate finance charges.
4. The kind of organization that maintains a record of your past borrowing and bill-paying habits is a _credit bureau___.
5. Creditors use your ability to repay debt and your history of borrowing and repayment to give you a _credit rating which is their evaluation of your credit worthiness.
6. When you pay your credit-card bills, you pay back not only the principal but also interest and fees, which together are called _annual percentage rate___.
Paying Off Debt
You have a $3,000 balance on a credit card with an 18% APR, now you suddenly come into a $3,000 windfall. Should you payoff your debt or invest in the booming stock market? Examine the following chart, then answer the questions that follow.
|...

...Inga Gudmundsson
15 October 2008
English 100
Analytical Essay
Debt
Credit card debt is one of this nation’s leading internal problems, and it has been for around the last 3-4 decades. When credit was first introduced, and up until around the late 1970’s up to today, the standards for getting a credit card were very high; so not everybody could get one. The bar got lowered and lowered to where, eventually, an 18 year-old college student with almost no income and nothing to base a credit score on previously could obtain a credit card (much like myself). The national credit card debt for families residing in the United States alone is in the trillions (Maxed Out). The average American family has around $9,000 in debt, and pays around $1,3000 a year on interest payments (Maxed Out). Many people have the concern today that these interest rates and fees are skyrocketing; and many do not understand why. Most of these people have to try to avoid harassing collecting agents from different agencies, which takes an emotional and psychological toll on them. While a lot of the newly recognized “risky” people (those with a doubted ability to make sufficient payments) are actually older people who have been customers of certain companies for decades, the credit card companies are actually consciously targeting a different, much more vulnerable group of people: college students. James...

...﻿DEBT MANAGEMENT & LEASING CASE STUDIES
Case study 1
Situation:
Raiyan Mellizas works as a clerk in one of the clothing companies in the Philippines for about seven years. He supports his family and himself through his job. He uses credit cards for additional to pay his essentials and his expenses.
Question1:
By the time Raiyan couldn’t control his expenditure using credit cards and he is having a difficulty in paying his debt, what he supposed to do?
Carrying debt can be extremely stressful for anyone. The only way to stop debt from running your life is through debt management. By managing your debts, you can avoid spending more than you earn and maintain some semblance of control over your finances. The key to successful debt management involves understanding where and how you spend your money. If you are like most people, you don’t keep a clear record of your ingoing and outgoing income. This needs to stop.
Debt management is all about knowing exactly where every single penny goes. To develop a successful debt management plan, you need to begin faithfully recording and monitoring your expenses.
The first step toward taking control of your financial situation is to do a realistic assessment of how much money you take in and how much money you spend. Start by listing your income from all sources. Then, list your fixed expenses, those that...

...﻿
Analysis of Credit Card Debt
Jeanette Macintyre
Argosy University
MAT 108
Analysis of Credit Card Debt
Credit card debt is a reality for many in today’s world. Suppose that you had a $5,270.00 balance on a credit card with an annual percentage rate (APR) of 15.53 percent. Consider the following questions and prepare a report based upon your conclusions.
1. Most credit cards require that you pay a minimum monthly payment of two percent of the balance. Based upon a balance of $5,270.00, what would be the minimum monthly payment (assuming no other fees are being applied)? $105.40
$5270* .02= $105.40
2. Considering the minimum payment you just calculated, determine the amount of interest and the amount that was applied to reduce the principal. Hint: You’ll need to find the total interest for the year first.
Annual interest $818.43 divide by 12 months= Interest paid: $68.20 principal paid: $37.20
$5270*.1553= $818.43
$818.43/12= $68.20
$105.40-$68.20= $37.20
3. Consider one of your credit cards. What is the balance? How is the minimum monthly payment determined? What would be the minimum payment? How much of the minimum payment goes towards interest? How much of the minimum payment goes towards the principal? If you do not want to share an actual balance or do not have a credit card, calculate these amounts using an imaginary credit card balance.
A.) My...

...Debt Versus Equity Financing Paper
Acc/400
Debt Versus Financing Paper
A company has a couple of basic ways to finance the business; debt financing and equity financing. This paper will define debt and equity financing and provide examples of both. Of both of these it will be identified as to which way has more advantages and why.
Debt Financing
Debt financing can be defined as obtaining capitol through borrowing money that has to be repaid over a length of time with interest. Examples of this type of financing are selling bonds, bills or notes to individuals or investors. In return for the lending the money individuals or investors become the creditors and have an agreement that the principal and interest will be paid back. Some other examples of debt financing are Small Business Administration loans, line of credit, and real estate mortgages.
Equity Financing
Equity financing is defined by obtaining capitol through selling common stock or preferred stock to individuals or investors. In return for the money paid shareholders get ownership interests in the corporation. An example of equity financing is selling shares of stock in the company.
Advantages
Some advantages to equity financing are; you can use your cash and that of your investors when you start up your business for all the start-up costs, instead of getting a loan having to make...